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 Monday, March 9, 2015

 

THE PURPOSE OF ADVERTISING

 

A few weeks ago we published a two part series in DISPATCHES’ titled “Learnings from Super Bowl XLIX” advertising (Click here to view Part 1 and click here for Part 2). One of our dearest friends and ardent fans, who is a peerless marketer, took exception to an exception I made regarding Budweiser’s “Lost Dog” commercial (the third in a series dating back to earlier Super Bowls). Specifically, while I clearly stated that the purpose of advertising is to “stimulate a (purchasing) behavior” I discriminated between the Budweiser spot and those of other advertisers whose messaging clearly did not stimulate purchasing behaviors. This set off an exchange of emails on the subject that follow. Did I go too far in trying to explain Budweiser? Read and judge for yourself.

 

Peerless Marketing Fried (PMF): I’ve shared today’s issue of DISPATCHES with students and a few professionals, Richard. I’ve received consistent reaction from the pros on one aspect.

 

They believe you are being way too charitable on the Bud “Puppies” spots.  You begin the paragraph with the proper premise that “the purpose of advertising is to stimulate consumer behavior,” but you then go on to debunk your own point. A gift to consumers, a greeting card, feel good?  Those may be legitimate supplements in the context of an ad that actually sells. But entertainment for it’s own sake?  

 

And I guess I agree with them, now that I’ve been challenged on this.

 

Richard Czerniawski (RDC): Hi PMF. I think then that I was not sufficiently clear on my point. Yes, the purpose of advertising is to stimulate behaviors. There are other reasons for advertising as well. I learned this at Coca-Cola. What I was trying to convey is that one of the principle drivers of sales is merchandising. By virtue of having a presence on the Super Bowl I expect that Budweiser would be able to leverage their merchandising funding to secure strong features and loads of display activity at retail, and probably help on-premise (bars, restaurants, etc.) activity. By virtue of having strong merchandising presence they would see a sizable bump in sales despite the absence of their being able to positively influence purchases on the basis of the message post Super Bowl.

 

Also, at least in soft drinks, but I suspect is similar in the beer category, there is another important constituency beyond the consumer, namely distributors. If it were Coca-Cola, and I don’t really know what has gone on with Budweiser (I can only surmise), the advertising would be to ignite the distributors and sales team to focus and blitz accounts to secure merchandising support and load customers. Finally, I think that Bud uses, as we did at Coca-Cola, a venue such as the Super Bowl to reward customers, distributors and company employees alike. So there really is a behavior but not the obvious marketing behaviors such as switching, adoption, etc. On another note, it’s a "tip of the hat" for that which has been already achieved. It’s a thank you and a share in the rewards. We did this at Coca-Cola during the holiday season. It tied in beautifully with all the merchandising we secured with the Sundblom Santa on the packaging and displays. (This is much, much different than the advertising for Nationwide, which was about raising awareness regarding child safety and has no ties to past, present or future sales. Perhaps, it makes their employees feel good about working there.)

 

If your students would hear me speak of the Bud Puppies spot of last year they would learn that I believe that spot did more for adopting puppies than it did for selling beer. This is what I said last year and (continue to) believe this year:

 

"So That’s The “Best” Super Bowl Commercial!?!

According to polls and viewership data Budweiser Beer’s “Puppy” is the best Super Bowl commercial. Really? The criteria used for declaring the “best” is “likeability” and “eyes on the television screen.” But “best” to a brand marketer needs to be something else. Best needs to be “most effective” in ringing the cash register (i.e., generating sales), and building brand equity to engender loyalty, especially at $4-million per 30-second pop.

 

How effective is Puppy? Oh, Budweiser sold plenty of beer leading up to, and on, Super Bowl day. However, this is the impact of being a sponsor of the Super Bowl, motivating distributors to sell behind the sponsorship, and aggressive promotion to generate significant merchandising support at retail and on-premise (i.e., in the bars and restaurants). As per the commercial itself, not to destroy your “warm and fuzzies,” my feeling is that it was not very effective using more relevant criteria for assessing the productivity of advertising. I think it probably stimulates a greater increase in adoption of puppies than sales of Budweiser. When viewers at home reached for a beer following the commercial it was the one they already had in the cooler, or their host was serving, be it Bud, Heineken, Miller, what ever. “Bring me a Silver Bullet honey.” CRASH!

 

I really do appreciate the entertainment and engagement value of “Puppy.” Thanks Bud for the warm feelings, no small feat, particularly if you were rooting for the Broncos. Of the two Budweiser commercials I would, had I been viewing the spectacle from a local watering hole, lifted a Bud to salute Lieutenant Chuck Nadd. Let’s toast those who serve, with whatever you’re drinking. Now, how much is that puppy in the window? You know, the one with the wagglely tail."

 

I think the same for this year but recognizing that the medium and venue, and alternate constituents, is a factor to be considered. The greeting card of thanks is for all of you who do and have done for us "this Bud’s for you.”

 

I’m glad this caused some controversy and got a dialogue going. I hope that I’ve made myself clearer. I don’t think Bud is stupid. Now let’s get that dialogue rolling again. If you’d like to put me on a conference call with your class I’d be happy to dialogue with them. All I ask is that, as I mentioned in the article, they keep their eyes, ears, minds and hearts open. They don’t have to agree.

 

Peace my friend and best wishes to your students.

 

PMF: To clarify, Richard, it was not students who raised the issue.  My students are probably still sleeping off their weekend partying.  

 

Having been in the beer business for some years, I do understand the notion of motivating distributors and retailers by “merchandising” advertising to get displays and promotions.  But the system can become motivated without showing puppies commercials.  The mass of AB advertising per se (ignoring the content) provides a strong reason for securing merchandising.  Securing in-store merchandising is, indeed, a legitimate business reason.  I get that.  And I’ll bet the vast majority of distributors or retailers didn’t know about puppies before the ad actually ran.

 

The issue, in my view, is when you drifted (in DISPATCHES) into the non-business purpose of simply entertaining people — in the absence of any sort of selling purpose.  Of course, advertising can be concurrently entertaining and effective. Your own reference to Snickers, for example.  Puppies certainly was not.

 

If one were to accept the premise that the purpose of any advertising might legitimately be sheer entertainment (ignoring any sort of business efficacy), where does one draw the line?  Any or all advertising can produced be just for fun?  With that rationale, you’d be reinforcing the idea that advertising doesn’t need to be designed to sell.  That seems a very slippery slope, my friend.

 

And, unfortunately, far too many unsophisticated advertisers and marketers actually believe that today!  The introduction to “Creating Brand Loyalty” touches on this stuff.

 

Yes, a legitimate “business” objective for a top manager at a company may be to motivate employees.  But there are far more effective, efficient, and (importantly) direct means to accomplish this than consumer advertising.

 

Truth be known, the main reason that AB management approve such advertainment is to assuage their own personal egos.  They sell an alcohol beverage with sometimes questionable marketing practices, they work for a wicked corporation, and their brands are not cool.  BUT at their cocktail parties and with their families, “they” can claim they were responsible for puppies or other drivel.  

 

Bud may not be stupid.  They’re egotistical.  

 

Coke, be damned.  They’re wrong.

 

Sorry, we have to disagree on this one.

 

RDC: Yes and no. I probably should not have added the “exception" and tried to explain the rationale for a Puppy trilogy. The reason I did was because there were so many commercials that obviously were not trying, or were merely oblivious, to stimulate a behavior. 

 

Perhaps I was too generous to Bud, particularly in light of your views about them. Yes, I really do believe the purpose of advertising is to stimulate a behavior, and build brand equity. The stimulate behavior part is about ringing the cash register now. The build brand equity part is being true to the brand’s positioning. Yes, Bud could be assuaging their guilt but if they are egotistical (I guess what big corporations and executives are not?) they probably don’t feel much guilt. And, by the way, I think the word went out early to distributors and customers alike about the 3rd installment in their trilogy and it was used as a selling point (since most of the world believes in “likability” as a key factor in so called good advertising).

 

I really do believe that advertising is used to stimulate behaviors for different constituencies. For example, the Pepsi advertising that shows a Pepsi and Coke route salesman in a diner with the Coke guy drinking a Pepsi is about motivating distributors to outsell Coca-Cola in gaining merchandising. I believe, and you would know much better than I, that the distributor is very important in driving the business. Advertising may sometimes be used to reach these other constituencies in a way that is motivating a desired behavior or encourage a higher level of performance.

 

Also, if I might make an analogy to couponing, during my sales training I sold a ton of incremental cases of Folger’s behind a coupon on top of a trade discount. I’d use the coupon to get the feature price lower (sometimes lower than the cost of coffee for the retailer) and build huge end-aisle displays that became a self-fulfilling prophecy. (You build the displays and the consumers come and buy.) I’d talk about the broad reach of the coupon in LA (where I sold). What they did not know is that the redemption rate on these newspaper coupons was very low (like 1% depending upon the value of the coupon). In Bud’s case, the medium and venue along with “likability” of the ad, generated a lot of distributor and retailer interest and helped create a self-fulfilling prophesy that was really driven by the merchandising (as it was for us in coffee and soft drinks).

 

One last note, I think what I’m saying is that there are exceptions to every principle. If you are going to shatter a principle then you need to know which one it is and have a very sound reason for doing so. Again, I was surmising an exception to the principle. I didn’t need to do that. I kind of felt I should address what Bud may have been thinking (although the lawyers would declare it is mere speculation and that it has no place in the courtroom since I can’t really say what they were thinking) given a large number of spots that did not seek a behavior objective and did not derive the benefits that accrue to a Budweiser. I completely proclaim that I do not believe the message itself changed behaviors (perhaps, it reinforced Bud drinkers choice, which is not a negative) as noted in what I wrote last year. My views on that have not changed.  I may have been incorrect in my speculation based upon my (unique) experiences but I did so. Yes, let’s forget about the exceptions and tie advertising messaging to a consumer behavior objective.

 

PMF: Thanks for taking the time to craft your thoughtful reply, Richard. I better understand where you are/were coming from now.  

 

And, of course, I wasn’t thinking clearly about all this myself when I sent you my first email yesterday.  It was only after others pointed out the problem to me (after I forwarded DISPATCHES to them with my endorsement) that I realized I’d not clearly thought through the critical purpose of any advertising. 

 

A huge company, such as ABI, can afford to spend a total of probably $6MM on such ego peccadillos.  I absolutely believe that was their motivation, only later rationalized with other quasi-business motives.

 

But this sort of behavior is a terrible lesson for other marketers or advertisers.

 

BOATS & HELICOPTERS:

Despite the “goings” back and forth, our Peerless Marketing Friend and we agree, the purpose of advertising is to stimulate a (purchase) behavior. It is to get them to do something such as adopt, switch, trade-up, etc., in order to ring the cash register (i.e., make a sale). We also believe that advertising not only must ring the cash register but must also work to build brand equity by reflecting the brand positioning strategy. There is no either/or. We’ve got to have both! If we don’t ring the cash register then our advertising budgets will have been squandered, we will have suffered (untold) opportunity losses and our ad budgets will be cut. If we ring the cash register but don’t build brand equity we’ve merely enacted a transaction versus transformation with customers. In other words we will not have helped instill loyalty.

 

Here are some additional thoughts for your consideration:

 

1.  Remember the purpose of advertising is to stimulate a purchase behavior. It is certainly not to entertain. Entertainment is merely one of many ways to present the strategic message intended to motivate a change in behavior. It is a means not the end. Ah, but there are so many additional means. If you are going to use an “E” word think “Engagement” value.

 

2.  Check your creative brief to ensure that the objective of your advertising is to stimulate a behavior. By the way, “awareness” is not a behavior focus for the creative product. Awareness is a media objective. Nor is “trial” a suitable objective for the creative. There is a difference between trial from “adoption” and “switching.” Each requires a very different message. On the other hand, trial is a legitimate promotion objective.

 

3.  Make your advertising behavior objective SMART. You’re familiar with the acronym: Specific, Measurable, Achievable, Relevant (to the Business Objectives of Sales, Market Share and Profit) and Timebound. So, you’re familiar with it. Okay, now use it! Make certain the achievement of the advertising behavior objective will help the brand achieve its business objectives. Do the math!

 

4.  Measure your advertising against the advertising behavior objective. Who gives a damn whether potential customers like your advertising? The important questions to ask potential customers and customers alike are: a) what is the benefit of this brand; b) is this benefit important to you; c) is it different than competitive entries; and d) what is your purchase interest?

 

5.  Be ruthless! Don’t settle!! If your advertising doesn’t achieve your purchase behavior objective then don’t run it! If you were president of your brand and it was your money you certainly wouldn’t run it to meet an air or publication date. That’s merely squandering opportunity and resources. Make your advertising count.

 

Thanks to our Peerless Marketing Friend for engaging us in our stimulating dialogue and providing us with the opportunity to hone and clarify our thinking.

 

Best wishes for advertising that rings the cash register and, at the same time builds brand equity and a leadership brand,

 

Richard Czerniawski, and Mike Maloney

 


Richard Czerniawski


430 Abbotsford Road

Kenilworth, Illinois 60043

tel 847.256.8820 fax 847.256.8847


reply to Richard:

rdczerniawski@cs.com or

richardcz@bdn-intl.com

 

 

Mike Maloney


1506 West 13th

Austin, Texas 78703

tel 512.236.0971 fax 512.236.0972


reply to Mike:

mikewmaloney@gmail.com or

mwm@bdn-intl.com

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